Apple bungee jumps to pre-iPad levels

Crushed in the market’s broad sell-off before bouncing most of the way back

The steep spike in the chart at right says it all.

Apple (AAPL) shares, which had climbed nearly 80 points to more than $270 in the three months since Steve Jobs introduced the iPad, briefly lost it all in Thursday’s wild trading.

In the space of 20 minutes, between 2:35 and 2:55 p.m. EDT, it plummeted from nearly $248 a share to $199.25, before bouncing back at high volume to where it started.

The charts of other tech stocks had similar downward spikes, as the entire U.S. market went into freefall, triggered according to one rumor by an erroneous sell order and compounded by waves of high-frequency computer trading (See Dow’s wild ride). Google (GOOG) dropped nearly $40 during the sell-off, Research in Motion (RIMM) nearly $5 and Microsoft (MSFT) about $2.

But few stocks had as much to give up as Apple.

“I told you guys,” said Andy Zaky, who had warned just last week that the market was dangerously over-bought (See An Apple bull issues a warning for May). “On a positive note, if we do see a significant rebound and an accumulation day here shortly, this could be close to a bottom of the correction.”

Apple, which closed Wednesday at $255.99, ended Thursday at $246.25, down $9.74 (3.8%) for the day. It fell another $4.84 (1.97%) in after-hours trading.